43 thoughts on “How to Backtest Trading Systems, Part 1

  1. Good stuff as usual. I am going to join the lifetime membership soon. "Just not ready for my closeup Mr. Booker" that was for Jason

  2. Rob,
    PLEASE!! do a youtube video on cryptocurrency trading. We know Legacy markets hate bitcoin but, it is quite a challenge!!! A lot of trading in the states is done on Binance and GDAX or you can see BTC(bitcoin) charts @ tradingview. Thanks for the vids!!!!!

  3. Hey Bob I've been watching more of your videos since last Saturday when I became a Life time path member, But I need to learn more about BTing and Robots. Keep up the Great work

  4. from london: Started with ยฃ300 + ยฃ100, got it to 1k within a few days and lost it all within 1 hahaha

  5. Hey Rob, i like your techniques and you're very easy to learn from, ive done courses before and didn't really get alot of value from them, learnt alot from you so far, i love how basic your trading style is. Im from New Zealand but live in Australia

  6. dunno. i think what he is trying to get at is the term outcome bias. but backtesting actually tests the quality of the decision or process being made.

  7. Rob – thank you for the opportunity to learn from you. I ahve learned how to trade but not yet learned how to consistently make profits. Very frustrating. Looking forward to a real plan and strategy to follow.

  8. Thank you for taking the time but this was either bad strategy explained very well, or great strategy explained poorly. In either case, you are setting a lot of people up for failure here. You seem incredibly intelligent so I must be misinterpreting. Please help me to understand:

    – You don't believe in cutting losses? Huh? Why wouldn't you elaborate on this rather than ranting and theorizing about some old dead authors?

    – If in your opinion backtesting is moreso about building confidence rather than identifying an edge (I don't totally disagree) I am having trouble seeing the logic in including future data in your backtesting. If we are not backtesting to FIND an edge, then where are you suggesting the confidence come from when we hit the live markets? Anyone can be confident with the training wheels still attached to their bike. What happens when it's time to race without them?

    – The fact that you make light of people who "lie to themselves" while testing shows you seriously underestimate the impact of psychology on most people's trading. It's extremely subtle but yes, using future data in backtests and simulations absolutely has the potential to incur negative consequences. Not everyone can be a natural born genius with 1:1 relationship with his inner environment like you, sir. At least give some disclaimer to let people know in not such a condescending way that they really ought to get in touch with their own behavior if you're going to tell them to trade so vastly different from real life in their simulations.

    – 20 losses in a row? Long term losses? Uh..yeah most people would get out/change strategy at that point. It's almost like you are teaching how to marry ourselves to a strategy permanently and to do everything in our power to salvage the broken system rather than just save time and adjust the entire strategy.

    Unless I'm missing something, this lecture was absolute madness. Having controversial ideas is one thing but sheesh, your explanation leaves left much to be desired no offense.

Leave a Reply

Your email address will not be published. Required fields are marked *